eCPM [Effective Cost Per Thousand]

What is an eCPM?

eCPM is like the cost per kilo of online advertising pricing. It is effectively what you would have paid for advertising if you were using a CPM model.

If you want to compare different ad pricing models, then you should work them back to an eCPM to see which one is best. By doing this you are working out what the best price you can get for 1,000 impressions is. (ie if you are running a CPC, CPA and CPM campaign altogether, you translate them all into their eCPM value and then you can see what is making you most money).

What does eCPM mean?

It stands for effective Cost Per Thousand Impressions (with M being the roman numeral for 1,000), or sometimes equivalent Cost Per Thousand (they are the same thing).

To work it out you need to know how many ad impressions have been used, as well as the total cost. For both, these are the total values used (see below).

eCPM Formula

The effective cost per thousand equation is basically the same as CPM:

Click to enlarge

eCPM = (Ad Spend x 1000) / Ad impressions

Average Rate

The average CPM rate for 2015 is around $3 (about £2) – between £1 – £6 (approx. $1.50 to $10) is probably a reasonable range for display ads.

Top Tip

Some ad networks will try and reduce the amount of impressions they say they have used. They do this by telling you their fill rate to inflate their eCPM. Don’t let them off the hook that easily!

If you give an ad network 1,000,000 impressions, even if they only filled 10% of them, use the full 1,000,000 to work out their effective CPM.

Similarly for the amount of money you made, be sure to always calculate the money you are paying/receiving after any fees/commission have been taken by the ad platform. Otherwise you are comparing apples with oranges.